Every publicly traded radio broadcasting company in the U.S. has shared their Q1 2018 earnings results except one — Spanish Broadcasting System (SBS).
In fact, the Miami-based company on Wednesday evening just presented their Q4 and full-year 2017 results.
How did SBS do? Not great.
Consolidated net revenue slid 14%, to $36.7 million, from $42.1 million, in the quarter. While the Mega TV segment saw revenue grow by 25%, to $5.71 million, it is SBS’s radio division that accounts for the bulk of the dollars. The radio division saw net revenue in Q4 dip 18% to $30.68 million, from $37.54 million.
For the full-year, consolidated net revenue was down 7%, to $134.71 million. Radio revenue was off 8% for FY2017, to $119.5 million.
Calculating the non-GAAP measure of OIBDA didn’t help for SBS: Consolidated OIBDA was down 29% for Q4, to $13.3 million, and for FY ’17 it declined 26%, to $35.2 million.
“Our fourth quarter results largely reflect continued challenging operating conditions for the radio industry,” said SBS Chairman/CEO Raúl Alarcón Jr. “While the radio market is facing headwinds, our competitive position remains strong.”
As is typical with fiscally challenged broadcast companies, Alarcón talked up his radio station’s ratings performance (something Cumulus Media did before submitting its Chapter 11 bankruptcy petition in a New York court).
“Moving forward, the entire SBS team is sharply focused on building upon our successes to date,” he said. “Our goals in the year ahead include additional aggregate audience share growth and the delivery of compelling multi-platform experiences to our listeners and integrated advertising opportunities to our brand partners.”
What about those outstanding 12.5% Senior Secured Notes due 2017, which SBS has not repaid since they became due on April 17, 2017? “We continue to evaluate all options available to refinance the Notes,” Alarcón said. “While we assess how to best achieve a successful refinancing of the Notes, we have continued to pay interest on the Notes, payments that a group of investors purporting to own our 10 3/4% Series B Cumulative Exchangeable Redeemable Preferred Stock have challenged through the institution of litigation in the Delaware Court of Chancery.”
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The complaint filed by these investors, Alarcón continued, “revealed a purported foreign ownership of our Series B preferred stock, which we are actively addressing, including before the FCC in order to protect our broadcast licenses. Our refinancing efforts have been made more difficult and complex by the Series B preferred stock litigation and foreign ownership issue.”
Detailed information about each of these items was provided in SBS’s annual report.
While net revenue and OIBDA were down, SBS did enjoy a significant net income increase.
How? A $31.1 million income tax benefit allowed SBS to see its net income jump to $35 million ($4.81 per share), from $3.5 million (48 cents).